Article by Kyle Danish, Shelley Fidler, Kevin Gallagher, Megan Ceronsky and Tomás Carbonell

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Commentary

EPA finally issued its guidance to state permitting authorities on Prevention of Significant Deterioration permitting and Best Available Control Technology (BACT) determinations for greenhouse gases. The agency's guidance leaves states with ample discretion to make BACT determinations. Indeed, the guidance does relatively little in the way of setting down markers or creating predictability—other than an emphasis on energy efficiency . . . EPA also released additional rules for mandatory emission reporting, including the Subpart W rules for the oil and natural gas sectors . . . For more information on these EPA actions, see the VNF website at www.vnf.com.

Executive Branch

  • EPA Issues Long-Awaited Guidance on GHG Permitting for Stationary Sources. The Environmental Protection Agency (EPA) released a widely-anticipated set of memoranda providing policy guidance and technical information for the implementation of the "Best Available Control Technology" (BACT) requirement for greenhouse gas (GHG) sources applying for Prevention of Significant Deterioration (PSD) permits under the Clean Air Act. The new BACT guidance does not specify particular technologies that will qualify as BACT for particular sectors. Instead, the BACT guidance recommends that state and local permitting authorities continue to apply a five-step procedure that has long been used for BACT analysis for conventional pollutants. EPA stated that in many cases, the BACT analysis will result in the required application of energy efficiency measures. Seven technical "white papers" accompanying the BACT guidance provide sector-specific data on GHG mitigation options for electric generating units, large boilers, pulp and paper facilities, cement facilities, refineries, nitric acid plants, and iron and steel producers. EPA's policy memorandum also clarifies the administration of the Title V operating permits program for GHG sources. Under EPA's previously-released "Tailoring Rule," permitting of GHG sources under both of these programs will begin January 2, 2011, and cover an expanding set of sources over time. The BACT memoranda are available at http://www.epa.gov/nsr/ghgpermitting.html. For a more detailed summary, see Van Ness Feldman's Nov. 12, 2010 Alert.
  • EPA Finalizes GHG Reporting Rules for Petroleum and Gas Sector, Fluorinated Gas Sources. EPA released two supplements to its rule requiring reporting of GHG emissions from a variety of stationary sources and fuel suppliers. One supplemental rule, known as "Subpart W," requires reporting of methane and CO2 from equipment leaks and vents at facilities in the petroleum and natural gas industries, including offshore and onshore oil and gas production facilities; natural gas transmission compression facilities; liquefied natural gas (LNG) import, export, and storage facilities; natural gas distribution facilities; natural gas processing facilities; and underground natural gas storage facilities. The other supplemental rule adds five new subparts to the reporting rule, requiring reporting of fluorinated GHG emissions from several industrial sectors, including fluorinated gas production and electrical equipment manufacturing. The new requirements will take effect January 1, 2011, and the first reports to EPA under the new requirements are due by March 31, 2012. Both supplemental rules had originally been proposed along with the rest of EPA's reporting rule in March 2009, but were not finalized and were subsequently re-proposed in the spring of this year. The text of the new requirements is available at http://www.epa.gov/climatechange/emissions/subpart.html. For more information, see Van Ness Feldman's Nov. 11, 2010 Alert on the new rules.
  • PTO Extends Expedited Patenting for GHG Reduction Technologies. A trial program to expedite the processing of patent applications for technologies that reduce GHG emissions will be extended for another year. The U.S. Patent and Trademark Office (PTO) announced that the policy, which was set to expire December 8, will now continue until December 31, 2011, allowing the agency to review an estimated additional 3,000 patent applications. Under the policy, the normal two-year waiting period to receive a patent is compressed to 49 days.

Congress

  • Barton Attacks Upton in Fight for Chair of Energy and Commerce Committee. According to trade press reports, Rep. Joe Barton (R-TX) is circulating an unsigned document calling Rep. Fred Upton (R-MI) a "part-time Republican," citing specific votes on environmental and other policy issues. The "summary" of Rep. Upton's voting record also claims that Rep. Upton testified that "on global warming . . . the debate is done and it's time to spend." Rep. Barton has denied that he is responsible for the document. Rep. Barton has served as the top committee Republican on the panel for three terms, the GOP's limit for committee heads, and will therefore need a waiver from party leadership to retake the top position. In addition to Reps. Barton and Upton, Reps. Cliff Stearns (R-FL) and John Shimkus (R-IL) are also reportedly seeking the chairmanship.
  • Sensenbrenner Urges Retention of House Global Warming Committee. Rep. Jim Sensenbrenner (R-WI) wrote an op-ed published in Roll Call arguing that Republicans should keep the House Select Committee on Energy Independence and Global Warming as a vehicle for ensuring that EPA and the Obama administration do not promulgate overly burdensome and economically costly regulations on climate change and in other environmental policy areas. Some of his Republican colleagues have urged that the committee, which was created in 2009 by outgoing Speaker Nancy Pelosi (D-CA), be eliminated as wasteful spending. Rep. Sensenbrenner wrote that the committee is "more qualified than any other Congressional institution to ensure the administration doesn't bend to unrealistic international demands—and that the EPA doesn't attempt to do what Congress wouldn't" on climate change. The op-ed also argues that EPA's analysis of the costs of the Waxman-Markey bill "assume[d] impossibly rapid growth in nuclear power and an impossible explosion in the availability of 'international offsets'—essentially emission reductions in developing countries paid for by U.S. and European companies."

Judicial

  • Environmentalists File Petition to Compel GHG Regulations for Cement Kilns. The Sierra Club and the Natural Resources Defense Council filed a petition in the United States Court of Appeals for the District of Columbia Circuit challenging EPA's recently-finalized New Source Performance Standards for cement kilns, on the grounds that EPA is obligated under the Clean Air Act to regulate GHG emissions from the kilns. In the preamble to the standards being challenged, EPA acknowledged that "it may be appropriate for the agency to set a standard of performance" for GHGs from cement kilns. However, the agency said that such a requirement would exceed the scope of its initial rulemaking proposal and thus would have to be implemented in a separate rulemaking.

States and Cities

  • New York Action Plan Provides Blueprint for 80 Percent Reduction by 2050. The New York State Climate Action Council has released an interim report that describes policy options that can assist the state in achieving its goal of reducing statewide GHG emissions 80 percent from 1990 levels by 2050. The report also provides a quantitative analysis of the costs, savings, and GHG emission reduction potential for specific policy options with respect to the mid-point benchmark of a 40 percent reduction from 1990 levels by 2030. The plan is available at http://nyclimatechange.us/InterimReport.cfm.

Industry and NGOs

  • AMA Backs EPA Regulation of GHGs. At its semi-annual policy meeting in San Diego, California, the American Medical Association (AMA) voted to support EPA's efforts to regulate GHGs under the Clean Air Act because of the expected public health benefits of these regulations. The AMA resolution also opposes "any efforts by Congress to delay or impede EPA's authority to issue regulations on greenhouse gas emissions." In a statement released after the vote, the AMA affirmed that climate change "is a serious issue that can negatively affect the health of the public."

Studies and Reports

  • UN, World Bank Report Finds Natural Disasters Will Cost Much More Than Near-Term Disaster Mitigation. A report by the United Nations (UN) and the World Bank projects that annual monetary losses for natural disasters will rise to $213 to $253 billion worldwide by the end of the century if anticipated climate change impacts from tropical cyclones are included. These costs and rising mortality rates can be dramatically reduced, the report found, if governments and international donors invest in preventive systems (including weather forecasting), smart development planning, and infrastructure improvements. Their research suggested that improving security of property (such as through clear title) encouraged investment in disaster prevention measures; the lack of rent controls led to housing that is better built and maintained; and investment in public transportation encouraged the poor to live farther from work and away from crowded slums and marginal land exposed to storms, floods, or mudslides. The report is available at http://www.gfdrr.org/gfdrr/nhud-home.
  • NASA Study Finds Climate Change Will Drive Wildfires. Research by the National Aeronautics and Space Administration (NASA) found that rising global temperatures are likely to increase wildfire frequency over the next several decades in the western United States and in other arid regions such as northern Africa and southern Asia. The researchers found that climate (particularly low humidity) had been the primary driver of wildfires before the Industrial Revolution, and that human agency (land use change, ignition and suppression) has been the primary driver since that time. Rising temperatures, they found, will soon create "an unprecedentedly fire-prone environment." The study, published in the Proceedings of the National Academy of Sciences, is available at http://www.pnas.org/content/107/45/19167.full.

International

  • India, U.S. Sign Clean Energy and Energy Efficiency Pact. Indian Prime Minister Manmohan Singh and United States President Barack Obama signed an agreement under which India and the U.S. will cooperate on clean energy and energy efficiency research and development. The pact creates a U.S.-India Partnership to Advance Clean Energy under which the two nations will establish a Clean Energy Research and Development Center (Center) that conducts research and development on building energy efficiency, solar energy, and advanced biofuels. Each nation will contribute $5 million to the Center annually for five years, with private sources providing matching funds.

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